TMI Blog2010 (10) TMI 1017X X X X Extracts X X X X X X X X Extracts X X X X ..... inter alia, required the appellant to start commercial operations within twelve months from the date on which the agreement was executed. The appellant s case before the Tribunal so also before us is that, it was ready to commence commercial operations in the last week of February 1999 and had sought permission of the respondents to do so. Permission was, however, denied on the ground that certain technical deficiencies remained to be removed and certain conditions for the grant of permission remained to be fulfilled. In the meantime the Union of India appears to have offered a Migration Package to all the Telecom Operators in July 1999. Under this package which was offered to the appellant-Shyam Telelink Ltd. on 22nd July, 1999 the fixed licence fee was to stand replaced by a revenue-sharing arrangement w.e.f. 1st August, 1999 subject to the stipulation that atleast 35% of all outstanding dues including interest payable as on 31st July, 1999 and liquidated damages in full is paid by the appellant on or before 15th August, 1999. Migration Package further provided that the company shall have to accept all the conditions stipulated in the package and that all proceedings instituted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant who demanded refund of the entire amount of ₹ 8 crores recovered towards liquidated damages from it. 6. The respondent contested the petition before the Tribunal, inter alia, on the ground that the petitionerappellant was not entitled to question any demand arising out of the agreement executed between the parties after it had unconditionally accepted the Migration Package under which it agreed to deposit without demur the outstanding licence fee as also the liquidated damages payable under the licence agreement. The respondent also asserted that the appellant was not ready with the commissioning of the service as was evident from the admissions made in several communications sent by it to the respondent. It was further pointed out by the respondent that the computation of actual liquidated damages could be undertaken only after the appellant had commenced commercial operations. The actual charges after such computation were according to the respondent determined at ₹ 29.86 crores but the demand was restricted to ₹ 8 crores in terms of the explicit limitation prescribed under the licence. An amount of ₹ 7.3 crores having already been paid under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spect of providing Direct Exchange Lines (DEL-s) and Village Public Telephones (VPT-s) as per committed targets failing which Liquidated Damages (LD-s) are payable; and (e) Establishment of a separate bank account (an escrow account as stipulated under condition 18.6 of the Licence Agreement). 8. Material further established that the deficiencies pointed out by the TEC could not be rectified by M/s Qualcomm manufacturer of the equipment purchased by the appellant forcing the latter to go for a new set of equipment from a new vendor in December 1999 which equipment was finally delivered and installed in April 2000. It was only after the installation of the said equipment that fresh test certificates were issued by TEC on 1st June, 2000 leading to the start of the commercial operations on 5th June, 2000. The fact that the appellant was not ready to commence commercial operations in February 1999 is evident from its own letter dated 19th July, 1999 in which the appellant had clearly admitted that the system was not yet ready for such operations and that the appellant was engaged only in monitoring and testing the credential of the new technology and the related software/hardware ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld be examined in detail but the appellant failed to do so nor was any material placed on record to show that any discriminatory treatment was meted out to it. At any rate so long as the conditions of the agreement entitled the respondents to decline permission to commence commercial operations on account of failure on the part of the appellant to comply with the conditions stipulated in the said agreement, which condition included a defect-free efficient system, the fact that some other service providers were given permission in the peculiar facts of their cases and deficiencies allegedly noticed in their system could not make out a case for the appellant to question the demand raised on the basis of a package which the appellant had accepted unconditionally and pursuant to which acceptance a substantial part of the liquidated damages amounting to ₹ 7.3 crores had been deposited by it without any demur. 11. The Tribunal has also held and in our view correctly so that the computation of the liquidated damages for noncommencing of the services as well as limiting the same to a total amount of ₹ 8 crores was in conformity with the licence conditions executed between t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tes acceptance on its part of its liability to pay especially when it was only upon such payment that it could be permitted to avail of the Migration Package. Allowing the appellant at this stage to question the demand raised under the Migration Package would amount to permitting the appellant to accept what was favourable to it and reject what was not. The appellant cannot approbate and reprobate. The maxim qui approbat non reprobat (one who approbates cannot reprobate) is firmly embodied in English Common Law and often applied by Courts in this country. It is akin to the doctrine of benefits and burdens which at its most basic level provides that a person taking advantage under an instrument which both grants a benefit and imposes a burden cannot take the former without complying with the latter. A person cannot approbate and reprobate or accept and reject the same instrument. In Ambu Nair v. Kelu Nair AIR 1933 PC 167 the doctrine was explained thus: Having thus, almost in terms, offered to be redeemed under the usufructuary mortgage in order to get payment of the other mortgage debt, the appellant, Their Lordships think, cannot now turn round and say that redemption under th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Co. Ltd. (1921) 2 KB 608, at p.612, Scrutton, L.J.] According to Halsbury s Laws of England, 4th Edn., Vol. 16, after taking an advantage under an order (for example for the payment of costs) a party may be precluded from saying that it is invalid and asking to set it aside . (para 1508) 16. In America Estoppel by acceptance of benefits is one of the recognized situations that would prevent a party from taking up inconsistent positions qua a contract or transaction under which it has benefited. 17. American Jurisprudence, 2nd Edition, Volume 28, pages 677-680 discusses Estoppel by acceptance of benefits in the following passage: Estoppel by the acceptance of benefits: Estoppel is frequently based upon the acceptance and retention, by one having knowledge or notice of the facts, of benefits from a transaction, contract, instrument, regulation which he might have rejected or contested. This doctrine is obviously a branch of the rule against assuming inconsistent positions. As a general principle, one who knowingly accepts the benefits of a contract or conveyance is estopped to deny the validity or binding effect on him of such contract or conveyance. This rule has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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